Updated: Oct 15
In business, as the saying goes, you can’t manage what you can’t measure.
Well, you can. You just can't manage it well.
And there is no question that breaking news can have material impacts on business. The problem is, we really cannot reliably measure the media. At least not yet. But we definitely can measure the impacts.
Consider the mother of all PR campaigns, hatched by the father of PR. Nearly a century ago, a New York suffragette lit a cigarette while strolling down Fifth Avenue during the annual Easter Day parade, gracefully breaking a longstanding social taboo against women smoking in public. Edward Bernays had tipped off reporters, and their grainy newspaper photos linked smoking with the fight for women’s rights – and doubled Lucky Strike cigarette sales in the process.
More recently, Wells Fargo experienced the exact opposite outcome. The bank settled allegations that its executives for years had pressured tellers to meet inflated sales goals, which led to the creation of millions of bogus bank accounts. Consumers reacted immediately to news the bank had fired more than 5,000 tellers -- but not a single executive -- and sales were cut in half.
There's the rub. For decades, companies have focused on measuring the success of marketing communications campaigns in a quest to demonstrate a return on PR investment. But in business, the power of the press cuts both ways. Publicity can certainly drive customer acquisition. But breaking news also drives customer attrition. And net-net, the attrition impacts are higher.
Proprietary studies have confirmed that news moves the needle in terms of consumer awareness, brand perceptions, and purchase consideration in ways advertising could only dream of. Beyond that, news has been shown to impact customer satisfaction and employee engagement scores. And in a crisis, news is a catalyst that can evaporate billions of dollars in enterprise value, reflecting investor expectations of lost sales, market share, and earnings.
Bottom line, business communications has an opportunity to manage both the tailwinds and headwinds of news.
So how do we factor news into the business equation? How do we move beyond measuring what was published to also gauge what news people actually heard and saw? How do we measure the valence of the news consumption? At what point does that valence signal potential sales impacts? And how does the data help inform real business decisions?
Welcome to the Headline Risk Whiteboard, a blog dedicated to enhancing communication research tactics and elevating business communication strategies.
To help you locate things that are interesting to you, the Whiteboard blogs will be divided into four main categories:
Monitor: These blogs will focus on media content analysis, and ways to break free from flawed volume and tonality metrics. We also will explore derivative metrics, including ad value equivalence and share of voice, mainly to ease the pain for those of you still searching for the elusive ROI. If your content analysis relies on the dark arts of Boolean search, these blogs are for you.
Measure: This is where we will start to forge some new tools for communication research. Warning: These blogs will challenge conventional wisdom about the reach and resonance of news with consumers. We are on a mission to create reliable, validated and replicated metrics for managing business communications. If you are looking for cutting-edge media metrics, look no further.
Manage: Communication affects much more than brand preference, sales and stock price. News coverage has been linked to significant and lasting shifts in customer satisfaction scores, employee recruitment and retention, market share gains and losses, and legislative and regulatory inquiries. This is where the Whiteboard blog will go outside the box.
Mitigate: At this point, we will be off the beaten path. This is where we will work to define the news narrative and long-tail business impacts. Business relies on time-series data to assess outcomes, and multivariate analytics to make critical decisions. Mitigating headline risk is where business communications earns its stripes, eventually tapping into emerging technologies to guide critical decisions that maximize returns and minimize risk.
If you have read this far, welcome to the Whiteboard.
As we get started, thank you for connecting with this blog. Drop me a line to introduce yourself. Let's talk about the challenges you are facing in monitoring, measuring and managing communication. Let's talk about mitigating media shocks.
Then, let's step up to the Whiteboard.